Photo Courtesy of Laurie Buckhout for Congress website.
Republican First Congressional District candidate Laurie Buckhout has been fined nearly $2,600 and suspended from prediction market Kalshi for three years after the company found she purchased contracts related to her own candidacy.
According to an Aug. 28 Notice of Settlement of Disciplinary Action issued by Kalshi Exchange, Buckhout purchased less than $1,000 worth of contracts related to her candidacy for public office.
Kalshi found the transactions violated Rule 5.17(z), which prohibits a trader from participating in a market when that person is a decision maker or has any direct or indirect influence over the outcome of the underlying event.
According to the settlement, Buckhout’s candidacy made her a direct decision maker with influence over the outcome of the congressional election contract.
“Trading on such events is strictly prohibited under Rule 5.17(z),” the settlement states.
Kalshi did not identify in the settlement the specific contract Buckhout purchased or state whether it involved the Republican primary, the November general election or another market related to her candidacy.
The settlement also does not disclose the exact amount Buckhout spent beyond stating it was less than $1,000, when the transactions occurred or whether she made a profit from the trades.
Kalshi said Buckhout cooperated with its inquiry and agreed to resolve the matter by accepting the company’s conclusions, paying a financial penalty and accepting restrictions on her ability to trade on the exchange.
Under the settlement, Buckhout was suspended from direct or indirect access to Kalshi for three years and assessed a financial penalty of $2,589.96.
The disciplinary action became effective Aug. 28.
Buckhout acknowledged the trading in a statement provided to the Roanoke Valley Reporter by her campaign Monday.
“I bet on myself. Literally. It was a dumb mistake, and as soon as I learned there was an issue, I worked to make it right. Safe to say my career as a Kalshi trader was short-lived,” Buckhout said.
Prior to receiving the statement, the Reporter submitted nine questions to Buckhout’s campaign seeking additional information about the transactions.
Among those questions, the Reporter asked which contract or contracts Buckhout purchased, when the transactions occurred, the exact amount invested, whether she realized a profit or loss and whether personal or campaign funds were used to make the purchases.
The Reporter also asked whether Buckhout knew at the time of the transactions that Kalshi prohibited candidates from trading on contracts involving races in which they were candidates, whether Kalshi initiated contact with her about the trades and whether she or her campaign had been contacted by the Commodity Futures Trading Commission or another federal agency regarding the matter.
The campaign did not answer those questions and instead provided Buckhout’s statement.
In a subsequent follow-up, the Reporter also asked whether Buckhout intends to use personal funds or campaign funds to pay the $2,589.96 penalty. As of publication, the campaign had not responded to that question.
Kalshi operates prediction markets that allow participants to purchase contracts based on the outcomes of future events, including political elections.
The disciplinary settlement does not accuse Buckhout of violating federal or state law. The action concerns a violation of Kalshi’s rules governing who may trade contracts on its exchange.
Buckhout is the Republican nominee for North Carolina’s First Congressional District and is challenging Democratic incumbent Congressman Don Davis in the November general election.
